How to include a label in jQuery Select2?

I've set up a Select2 instance that queries my database and renders the results via AJAX on an input that the user has access to.

Everything is working but as this is a location selection input for a user and there are districts and municipalities with same names, for example, I want to add a label for each result to identify them either as "District", "Municipality", "Parish", etc. but I'm unable to do so, I've been unable to find any support on this matter on the Internet and the extension itself doesn't seem to be able to do this,

Select2 AJAX Function

$("#location-property-alert-location").select2({
      placeholder: "Type the name of the location",
      minimumInputLength: 2,
      ajax: {
        url: '/ajax/search-locations-by-query',
        dataType: 'json',
        type: "GET",
        data: function data(params) {
          return {
            query: params.term // search term

          };
        },
        processResults: function processResults(response) {
          // return{
          //     results: response.name
          // };
          response = response.map(function (item) {
            // console.log(item);
            return {
              id: JSON.stringify(item), // json_encode the data so we can pass this through the ID
              code: JSON.stringify(item),
              test: "hello",
              text: item.location_name
            };
          });
          console.log(response);
          return {
            results: response
          };
        },
        cache: true
      }
    });

I know Select2 can take additional data parameters such as the code and test parameters I added above but I don't know how exactly I can use these to create elements within the results with each item's category, for example, as portrayed in the screenshot below.

Each item's category is being stringified so I can pass this data through the form's submission either way but I need to identify each item's category on the frontend for the user to be able to differentiate locations,

Anyone has any idea on how to do this?

Cheers

Note: I don't want Select2's label appearance which basically groups options per category.

You can use templateSelection which will format your selection appearance and then change the result according to your json data.

Below is the demo for how this works with random json data.

function formatResult(item) {
  //checks if the id present or not
  if (!item.id) {
    return item.text;
  }
  //return the format options..
  var element = $(`<span>${item.text}<span class="text_small">${item.username}</span></span>'`)
  return element;
};

$("#location-property-alert-location").select2({
  placeholder: "Type the name of the location",
  minimumInputLength: 2,
  ajax: {
    url: 'https://jsonplaceholder.typicode.com/users', //this is just for demo...
    dataType: 'json',
    type: "GET",
    data: function data(params) {
      return {
        query: params.term // search term

      };
    },
    processResults: function processResults(response) {
      response = response.map(function(item) {
        return {
          id: JSON.stringify(item.id),
          text: item.name,
          username: item.username //pass here extra param
        };
      });
      return {
        results: response
      };
    },
    cache: true
  },
  templateResult: formatResult //your selection format
});

.text_small {
  font-size: 10px;
  color: grey;
  margin-left: 10px;
}

<link rel="stylesheet" href="https://cdn.jsdelivr.net/npm/select2@4.1.0-beta.1/dist/css/select2.min.css">
<script src="https://code.jquery.com/jquery-3.5.0.js"></script>

<script src="https://cdn.jsdelivr.net/npm/select2@4.1.0-beta.1/dist/js/select2.min.js"></script>

<select id="location-property-alert-location" style="width:300px"></select>